SacOil, an independent African oil and gas company, has settled its legal dispute with Nigel United Oil Company regarding the Oil Prospecting License (OPL) 233 offshore Nigeria.
OPL 233 is an offshore oil block that is located in the shallow marine area of the prolific Niger Delta region. It encompasses an area of approximately 126 square kilometers and is located in water depths ranging from 3 to 10 meters.
Back in May 2019, SacOil terminated its participation in OPL 233 off Nigeria and initiated a process to recover costs incurred on this asset totaling R228.8 million ($19.8M), including capitalized borrowing costs.
Nigdel, the operator of OPL 233, disputed the terms of SacOil’s conduct in relation to this asset and its subsequent withdrawal and started arbitration proceedings against SacOil. The exit from this asset also canceled future commitments and contingent liabilities totaling R713.3 million ($66.1 million).
SacOil said on Tuesday that, after careful consideration of the independent legal and financial opinion provided to date, the company has entered into a settlement agreement with Nigdel. According to the agreement, both parties have withdrawn their respective litigation and arbitration claims.
Dr Thabo Kgogo, CEO of SacOil, commented, “This settlement removes any distraction in relation to our previous participation in OPL 233. The board of SacOil is confident that this is in the best interests of all our stakeholders, based on the sound legal and financial advice we have received.”
Kgogo added that the settlement will not have an impact on SacOil’s financial results for the current year.
Offshore Energy Today Staff